The rupee rallied at opening at 95.76 to the dollar, having settled at 96.73 on Friday. The currency was a standout performer in Asia’s foreign-exchange markets, with most regional peers trading in a narrow range. The Indian rupee surged 1% at open on Monday after the central bank alleviated pressure on the currency by diverting oil companies’ dollar purchases away from the spot market and moved to temper corporate demand for forward dollars. The Reserve Bank of India on Saturday unveiled a series of measures aimed at addressing two key sources of pressure on the rupee: persistent dollar demand from oil marketing companies, which has been amplified by high crude prices, and demand from corporates seeking to hedge against further currency weakness. Expectations of further weakness had encouraged importers to step up purchases of forward dollars to protect against higher future costs. That hedging demand, in turn, added to strain on the currency, creating a cycle of expectations of depreciation, increased hedging and further weakness. The RBI barred firms from rebooking cancelled rupee-linked derivatives, slashed the threshold for transactions without underlying exposure and mandated that banks set aside 20% cash against certain FX contracts, potentially raising the cost of hedging against rupee weakness. From the interbank market’s perspective, however, lower demand for forward dollars from importers could pull premiums down. Exporters' hedging activity, meanwhile, is not affected by the RBI's measures. While weaker importer forward demand points towards lower premiums, the wider balance-sheet costs, reduced liquidity, and RBI management of its own forward book could push pricing in the opposite direction. The dollar held ground near its strongest level in a year and a half in early Asian trade on Monday as an escalating Middle East conflict kept investors wary ahead of key US inflation data later this week that will influence monetary policy. Oil prices swung between gains and losses after Yemen's Iran-backed Houthis stepped up strikes on Saudi Arabia while two tankers were attacked over the weekend. Prices were also influenced by Sunday's announcement from US President Donald Trump about an energy ceasefire between Ukraine and Russia. Brent crude futures were down 1% at $103.55 per barrel in Asian hours. Beyond the geopolitical backdrop, the market's focus turns to Wednesday's US consumer price index report, one of the last major economic releases before the Federal Reserve's late-October meeting on interest rates. Against the yen , the US dollar was down 0.14% at 158.160 yen. The euro was up nearly 0.1% at $1.121, after clocking a fifth straight week of losses as the common currency bore the brunt of investor angst around France's fiscal health amid political uncertainty before the 2027 presidential election. The British pound was little changed at $1.3245. Gold rose on Monday, supported by a softer dollar and lower oil prices, as investors awaited key US inflation data this week for clues on the Federal Reserve's next policy move. Spot gold was up 0.3% at $4,206.01 per ounce, as of 0253 GMT, after hitting its highest since October 2 earlier in the day. US gold futures for December delivery gained 0.3% to $4,230.40. Softer oil prices on the back of Trump’s reported energy ceasefire between Russia and Ukraine, combined with a more subdued dollar, have given gold a window of opportunity to the upside to start the week. Among other metals, spot silver rose 0.5% to $61.12 per ounce, platinum gained 1% to $1,704.70 and palladium climbed 1.2% to $1,161.81. www.eforexindia.com......